BMGP continues work on pathogen detection and disease diagnostics technology Print
By M.E.Garza   
Wednesday, 01 September 2010 08:40

Late last year we told you about a small medical diagnostics company called Biomagnetics Diagnostics, Corp. (BMGP).

The company working on a revolutionary pathogen detection and disease diagnostics technology called in Integrated Optical Biosensor (IOBS). Work at Los Alamos National Laboratory is focused on a bench top waveguide-based optical biosensor platform.

Since that time the stock has more than tripled, but we think these shares can rise even higher.  The Company's plan plan is to eventually produce a handheld diagnostic unit that uses advanced waveguide technologies to very quickly and inexpensively detect disease- causing pathogens in human body fluids.  What is particularly interesting about this device is that it was developed by some of the top scientists at Los Alamos National Laboratory, one of the world's most significant research facilities.  The Company is currently working with Los Alamos scientists to further develop assays using a bench-top version of the waveguide system.

The diagnostics technology being commercialized by BMGP was originally funded by the Department of Energy and other programs, when the management team licensed it and signed a collaborative research agreement with the Laboratory.  According to company officials, under this research agreement, the scientists at Los Alamos effectively become the research and development arm of Biomagnetics Diagnostics for the validation of assays using the bench top system for this specific technology.  

Dr. Basil Swanson, the inventor of the technology from the Laboratory,  recently joined a BMGP hosted video-conference call during which some very exciting news was revealed.  Los Alamos laboratory personnel are working on an waveguide-based assay designed specifically to identify tuberculosis biomarkers. On the call, they indicated that significant progress is currently being made, many scientific questions remain.  Although validated in laboratory conditions, evaluation of the technology in real-world samples is required before efficiency of the test can be determined. Further, identification of more than one biomarker is required for the accurate detection of disease.  The resulting technology has the potential to revolutionize tuberculosis diagnostics throughout the world.

At present, the most commonly used testing method is a skin test.  Specifically, although there are two types on the market today, the Mantoux test is preferred because it is more accurate.  To conduct this test, a small amount of a substance called PPD tuberclin is injected just below the skin, inside the forearm.  After approximately 48 to 72 hours, a healthcare professional checks the injection site for signs of swelling with a horde of raised red bumps usually indicating an active TB infection.  This test is far from perfect, however, as false-positive test results are relatively common and can also result if the patient has been vaccinated with BCG vaccine.  Additionally, many children, older people and people with HIV may have a delayed- or no- response indication from this test.  A positive Mantoux test for TB usually leads health professionals to then have to conduct additional tests on the patient such as chest x-rays, CT scans or culture tests, all of which are time-consuming and expensive.

The IOBS technology being developed by Los Alamos and Biomagnetics offers several significant benefits over these traditional testing methods.  First and foremost is the level of accuracy.  Scientists at Los Alamos are trying to achieve a high level of sensitivity and specificity for TB detection of TB biomarkers on the bench-top prototype.  Additionally, BGMP plans to continue working with Los Alamos to develop the technology into a handheld unti and requires only minimally trained personnel in order to produce rapid results.  If BMPG can achieve this goal, the technology could become a game-changer for the medical diagnostic industry.  Furthermore, BGMP plans to extend the IOBS testing unit. It does not stop at TB diagnostics alone, as the company plans to develop commercial assays for cholera and malaria, HIV/AIDS and other versions that are currently on the drawing board.  Additionally, Dr. Swanson indicated that a “sandwich assay” has recently been awarded a patent by the U.S. patent office.  This assay holds the promise of being able to diagnose multiple diseases using a single test.  For example, with continued development, a single test could be devised to diagnose three of the most common afflictions that lead to human mortality – namely, malaria, tuberculosis and HIV/AIDS.  Clinical trials in India and Africa are currently being initiated and we believe the U.S. FDA will also be forced to closely consider this groundbreaking technology, especially regarding tuberculosis diagnosis as this disease is a growing threat to the U.S. population.

A setback for the stock, although it certainly doesn't seem to have affected price appreciation recently, is that it is listed as a pink-sheet. We are told that will be changing shortly. The current number of outstanding shares is only 64 million, giving a total market capitalization of only $14 million.  We think the tuberculosis diagnostic technology alone, if successfully developed and commercialized, is likely worth many times this market valuation.  When we add the other diagnostic tests into the fold, these shares seem to be a very strong bargain at their current levels.  The Company is also in the process of diversifying some of its business through the acquisition of several Chinese operations, with a stated common share valuation for BMGP of $1.50.  Shares are currently trading at under $0.21.

An interesting video was recently produced by the scientists at Los Alamos that thoroughly discusses basic concepts and laboratory testing of this groundbreaking, waveguide-based optical biosensor technology.  The video can be viewed at . In addition, a pdf of the presentation titled; "Development of Rapid Diagnostics using the Waveguide-based Optical Biosensor" can viewed here:


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